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Published on:August 24, 2012

Unpaid Internships v. Employee? What are the requirements in Georgia?

For many recent college graduates in Georgia, the path after college no longer starts with a job. Instead many find they must take unpaid internships in order to find work in their fields. Many unpaid internship programs are failing to conform to federal requirements and participants in those programs may be entitled to back wages and damages.

You might wonder why there are requirements at all. Is this an example of the federal government overreaching? Can’t people choose to volunteer to do work? Isn’t this a violation of freedom to contract? To answer these questions, we have to think historically. Before 1936 there was no federal minimum wage in the United States. This meant that people were often working for very small amounts without any assurance that the amount they were originally hired for would not be later cut. The lowest paid workers were the most vulnerable to this. When work was scarce, it resulted in a race to the bottom, with people under bidding each other, far below the amount needed to earn a decent living. President Roosevelt stated that a minimum wage would create a “minimum standard of living necessary for health, efficiency and general well-being.”

Overtime the federal minimum wage has risen to its current rate of $7.25. This is the minimum amount of money that the federal government requires employers to pay workers. Even if a worker were to say to a prospective employer “I need this job so badly that I will work for you for $7.00 per hour or even less” the employer is legally barred from contracting around the minimum hourly wage.

So, how does this apply to internships, you may ask. Business, both for-profit and not-for-profit, are routinely advertising unpaid internships or low-stipended internships as a way to work for those companies. Without any other low-level entry positions, young workers feel compelled to take these jobs. But, for an internship to qualify to be unpaid, the internship must be educational in nature. The Department of Labor has issued Fact Sheet #71: Internship Programs Under The Fair Labor Standards Act to help bring clarity to what work qualifies for these unpaid internships.

The Fact Sheet sets out six factors for determining intern-status. To qualify to be an unpaid intern, all of the following must be true:

The internship is similar to vocational training.

The internship is designed to benefit and train the intern for work in the business’s field.

The intern is not hired instead of paid employees and receives supervision by paid employees.

The employer does not benefit from the labor of the intern and it might sometimes make the business less profitable or less efficient

The intern is not in training for a guaranteed job later; and

The employer and the intern know that the work is unpaid and for a limited duration.

If any of the above is not true, such as the intern is not being supervised or the business is having unpaid interns do secretarial work instead of hiring a secretary, then the worker should be considered an employee and is entitled to receive at least the federal minimum wage for his or her work. If you believe your unpaid internship fails to conform to these requirements, you may have a legal action. Betts and Associates would be able to advise you of your legal rights in Georgia.

Remember, you have a right to a fair wage. And, your employer also has a legal requirement to pay you for employment.